Hutchinson Technology swings to Q4 profit, rises to 52-week high
Shares of Hutchinson Technology Inc. (Nasdaq: HTCH) have hit a new 52-week high on news after the close on Thursday that the precision manufacturer swung to a fiscal fourth-quarter profit.
Net income for the three months ended Sept. 30 was $18.6 million, or $0.62 per share, compared with a profit of just $0.02 million, or breakeven per share, during the same quarter of 2006. Ten analysts surveyed by Thomson Financial were calling for earnings of $0.11 per share.
However, the results for the fourth fiscal quarter include a favorable income tax adjustment of $9.2 million related to Hutchison Technology’s deferred tax assets. Without the charge, earnings would have been $9.4 million, or $0.32 per share.
Net sales for the quarter increased 10.7% to $199.9 million from $180.6 million a year earlier.
“Our unit shipments and net sales reached record levels in the fourth quarter while our costs have been reduced by an estimated $35 million on an annualized basis,” said president and CEO Wayne Fortun.
Hutchinson Technology, which primarily makes suspension assemblies that hold magnetic read-write heads at microscopic distances above the disks in rigid disk drives, reported that it shipped about 246 million suspension assemblies during the fourth quarter, a rise of 14% from a year earlier.
Leading the way up were shipments for the mobile segment of the disk drive market, which jumped 83% from the previous fourth quarter.
“This increase resulted from our market share gains in the mobile segment combined with rapid growth in that segment of the market.”
At 1:27 p.m. ET, shares of Hutchinson Technology (HTCH) had added $3.65, or 16%, to $27.12. The previous 52-week high of $25.65 was reached on Oct. 2. The 52-week low of $17.69 was set on June 5.
